The support and resistance levels coincide in an uncanny manner with the Fibonacci retracements. Once again, the price was rejected off of what looks like a mini double top and has already (almost) made it to the support level. We may see a bounce to form what appears to be a triple top or a brief overshoot as the negative divergences on the PPO and RSI get extended further. Although I am putting in a short sell recommendation right now, it would be wise to wait for earning season to end and perhaps even wait for the Federal Reserve to cut interest rates. I believe this event will act as a 'sell the news' trigger where no amount of QE and lower interest rates will convince anyone to buy when a recession has essentially been confirmed.

For this trade it's recommended to use SQQQ and/or FNGD with stops below the recent lows on those leveraged ETFs. Again, I strongly advise to wait and be patient till the end of the month or at least set your stops even lower and gradually scale into your position.

The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.